A Firm's Net Income Last Year Was $1

question 131

Multiple Choice

A firm's net income last year was $1.5 million. Its net income grew 5 percent during the last "5" years. If that growth rate continues, how long will it take for the firm's net income to double?

• A) 7.6 years
• B) 10.47 years
• C) 14.21 years
• D) 14.55 years

Understand the characteristics and structures of various business entities, including corporations, sole proprietorships, partnerships, and limited liability companies (LLCs).

Identify the liability implications for owners or partners in different business forms.

Comprehend the taxation aspects of different business entities, particularly focusing on double taxation for corporations and pass-through taxation for entities like S corporations and partnerships.

Recognize the management and control mechanisms in various types of businesses, from sole proprietorships to corporations.

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Definitions:

Capital Flows

Movements of capital in the form of money or investment from one country to another.

Consumer Preference

The inclination of consumers to favor certain products or services over others, often based on factors like quality, price, or brand.

Partial Equilibrium Analysis

An economic analysis method focusing on the equilibrium of a specific sector or market, ignoring the effects on and from other markets.

Equilibrium Conditions

Refers to the state where market supply and demand balance each other, and as a result, prices become stable.